i'm becky quick along with joe kernen in pebble beach, california. back at cnbc headquarters, andrew ross sorkin and steve liceman, and of course neel kashkari our special guest this morning. linkedin, revenue more than doubling, the earnings topping forecast and linkedin added 14 million new profiles, bringing the total to 145 million profiles. the social networking site says more companies are paying for more access to its site. shares of linkedin slipping in some of the late trading. video gamemaker activism blizzard "call of duty modern warfare 3" but activision below expectations. clint eastwood starred in chrysler's halftime america super bowl ad. you might think he was in favor of what came with the auto bailouts but you should think again. eastwood spoke to "squawk box." >> we're talking from this time on, that's what the whole idea was from this time on, from now on we got to forget the bailouts were right or wrong. in my opinion, i'm not a pro with that, i think if companies don't have the ability and they're not run well enough to exist, t

in california, san bernardino city council declaring a fiscal emergency. the decision allows the california community to file for bankruptcy protection without having to first hold talks with its creditors. san bernardino could become the third city in california to seek protection from its creditors since late june. as we've been mentioning all morning we spent yesterday delivering alpha. i caught up with henry kravis. we discussed reforming the tax code and carried interest. >> we need to change our tax code. we need to change the tax system. we have to have a system that is very much focused on pro growth and pro jobs. if we do that, then everything should be up for grabs. that includes carried interest. that includes any other type of taxes and everything should be open and have a discussion. you can't pull out and i don't think you should pull out just private equity and so to my way of thinking, you really have to look at the overall. the biggest beneficiary of carried interest is not private equity or hedge funds it's the real estate industry. do yo

. >> facebook going to help california. my daughter actually put a little in her blog about that. not going to save california, but it's going to offset some of the damage the moon beam governor is causing out there. but when you see all these guys selling all those, these are people that got in and wait a minute, did you say $119 billion? and they're saying, yeah, okay, i'm good. here. here. here. some day it may -- but they're more than willing to say okay i think i'm good. >> so facebook is yesterday's news? >> if you were one of these early guys i'll tell you what, you play the russian guy. which will be so natural for you. you play that russian guy and you got in at a ten the of where it is. if they offer you 119 as the valuation, what do you say? >> da. >> exactly. [ speaking foreign language ] >> perfect segue for the global markets report. a little russian introduction. kelly evans is standing by in london. >> we've seen more axle rating losses. we did get decent headlines, spanish bond auction went off okay. japan came out with q1 growth figures. 4% annualized rate. but s

>> depends what part of the country you're in, california, chicago, it's going to stay expensive for a while. other parts will have a glut and price also be lower. >> we appreciate your time. see you very soon. >>> coming up, a check on the mortgage market and then your tweets, your money, how the world of social media is changing the investing landscape, from doug dachille, when we return. >>> time now for today's aflac trivia question. boeing is currently designing an airplane named after which children's television character? the answer when cnbc's "squawk box" continues. lac! ha! isn't major medical enough? huh! no! who's gonna help cover the holes in their plans? aflac! quack! like medical bills they don't pay for? aflac! or help pay the mortgage? quack! or child care? quack! aflaaac! and everyday expenses? huh?! blurlbrlblrlbr!!! [ thlurp! ] aflac! [ male announcer ] help your family stay afloat at aflac.com. plegh! it's something you're born with. and inspires the things you choose to do. you do what you do... because it matters. at hp we don't just believe in the power of tec

joining us from facebook headquarters in california. what is the feeling over there, julia? >> reporter: mandy, it's only 4:00 a.m. the facebook headquarters behind me are packed with over 500 employees in there right now, with facebook's 31st-this is a facebook tradition -- audio difficulties -- and outside employees day jobs. they take some breaks, i hear, to play some street hockey. it was all-nighters like this one that produced the like button, facebook chat, the precursor. one product we hear was created last night -- >> okay. we do apologize. we seem to be having some of connection problems. we'll try to get to julia as soon as we can. >> one of the world's leading value investors, lee cooper man, chairman and ceo of naked advisor of goldman sachs asset chairman and ceo. great to see you, especially today, lee. looking forward to the next hour. when we talked to warren, another great investor, he's like, internet, stuff like that, i really don't understand it. he finally bought some ibm, one of those newfangled companies. how about you? do you have something on facebo

let's bring you up to speed starting with pictures of that fire in california. check it out. the fire at chevron's large refinery in richmond is now contained but not out yet. smoke could be seen billowing over the bay area. a number of train stations were shut and residents were ordered indoors. the plant produces 245,000 barrels a day. they account for one eighth of the state's refining capacity. you'll see a spike upwards slightly as we try to figure out where things may go later today. in other news private equity firm carlisle emerging as the front-runner to buy dupont's paint business. apollo declined to increase its offer. and finally pfizer and johnson & johnson, bad news are scrapping further studies of an experimental alzheimer disease treatment. this comes after the drug failed to help patients with memory robbing condition in a second high-profile late the agency clinical trial. shares of those companies have been falling after hours on that news. >>> in other corporate news. acer wants microsoft to reconsider its planned venture into the tablet market. they argue

what's oregon doing that california is not doing? >> if you look at the tax policies of california, we are so backwards. we have 12% of the nation's population, but we have 32% of the nation's welfare population. california gets 25% of their entire budget from 144,000 people out of 37 million. why? because california punishes job creation but rewards government assistance. if you really want to look at the direction that america's going, it's california, and that's the wrong path. higher regulation, more boutique fuels. we can't build a new refinery so you don't have the infrastructure. the largest shell find today is where? monterey. but will we be able to tap it? we have new technology that we can environmentally tap new energy finds and also produce more american jobs. >> you need to tell that story between now and november, don't you? have you talked about this before? >> we talk about this every day. we just think the one thing you have found in america when you look just from 2000, where has the job growth been? it's been in th

. >> yeah, out in california. >> i'll tell you what, i'll give you an easy answer, read the newspapers. especially read the ones today that have quoted many politicians on just something like the health care, where they were, where they are, how do we know what these leaders are going to do? every year their story changes and this isn't unique to the left or the right, it's kind of unique to the entire d.c. area. i would say that that's, what, a handful of reasons right there, buddy. >> okay. we'll take it, rick, thank you for that. >>> kelly, views on the number and are we headed for another recession? >> you know, i'm an eternal optimist, but i do think we are slowly rapidly, you know, when i talk to business people and i talk to a lot just traveling around, you know, they tell me a very consistent message, and that message is that, you know, my business is kind of okay, but it's because i'm controlling my costs, which means they're not adding people, they're not buying equipment, and i'm not willing to spend a dime on the future until i see more certainty and more positive leadershi

i know california had a very large denial. so the numbers shouldn't be shocking but it puts us back where we ought to be. the preopening equities have been an about-face in the dow futures by about ten, they were up about eight, now down about two, nothing huge, but i have to tell you, i'm a bit surprised. we've traded down a couple of basis points in yield and the reason it's important for all you kind of armchair technicians out there, the moving average is 180 1.80 to 1.81 in a ten-year. down here the moving averages aren't the first thing you look at but there's more detail with the technical analysis down here, maybe closer to 2% but it is significant. we're monitoring which side of 1.31 the euro currency hangs out on. the euro and the dollar index in particular may be more concerned about issues in china, considering the biggest economy in europe, germany, has a pretty important relationship on the export side with china. back to you. >> okay, thank you, rick. for more on the claims numbers, let's get to steve liesman an

bloomington, california... austin, texas... we are all here to represent the country we love this is for everyone back home it's go time. across america, we're all committed to team usa. s. >>> this tuesday morning a new book talks about the september 2008 collapse of washington mutual. the author kirsten grind joins us on set. the book is called "the lost bank: the story of washington mutual, the biggest bank failure in american history." congratulations on the book. >> thank you. >> talking about lessons learned. almost four years back. any lesson learned? jamie dimon going tomorrow -- >> the headlines seem the same almost as four years ago almost with risk being taken at the banks. >> what is the biggest lesson for this book that you take away? >> the big lesson is the loss of culture eroded overtime. you can't say enough about how a company's culture is important. you saw this when there was that big epic goldman resignation. the culture at wamu became eroded, it became detached from its customer. >> you walked through some

i argued that basically we were at risk of what i call a hotel california, monetary policy, going back to the eagles song which is you can check out any time you want but you can never leave. that's what i worry about. theoretically we can check out any time we want from this program but we practically, because we're going to have an engorged balance sheet, we may never be able to leave this position. so i have some concerns. i was concerned about the 2.5% mention, even, of inflation one or two years out in terms of expectations. the market becomes fixated on the unemployment target that we actually install its threshold, not a target that we put in there. but, i lost my arguments. there are others that argued similarly. they'll let them speak for themselves. but here's the thing, the committee makes a decision under the leadership of ben bernanke. this is ben bernanke's fed. its his legacy going forward, and then we leave the table and we're still friends. so, can i sell it to you? i can't sell it with passion. but i will say that this is action in a city called washington, or sometim

pimco's ceo mohammed el aryan is a member of the advisory board and joins us from newport beach, california. how are you? >> i'm fine, how are you, becky? >> i'm doing great. mohammed you've been a friend of "squawk" for a long time. >> absolutely. >> you don't forget your friends. >> never. >> never, even if you were to become prime minister of egypt, which is being speculated right now that you could be chosen, there's a lot of debate taking place in the country, you could be chosen in something of an ala mario monti decision or choice to come in and head a new government in egypt. if you were called, how would you respond? >> so becky, first, i have no idea where this rumor is coming from. i haven't been approached formally nor do i expect to be approached. if i were to be approached which i don't expect but if i were, i can tell you that i would not be a candidate. there are many more qualified people out there and i think at this stage in egypt's history in particular it is very important that the candidates include people living in egypt and that have gone through in person the revolu

his hotel, california, who wrote that song? >> eagles. >> i'll give him prince. >> we're going to party like it's 1999? >> yeah, we can party like it's 1990. listen, i'm not talking about the economy, i'm talking about -- you have so much money. >> raspberry. >> red beret. >> i didn't say red beret i cedras berry beret. >> i don't have monitors. >> so then, we will get to 6.5% on track in unemployment? this will work? >> now you're asking me a different question. >> do you believe in the new normal? like the pimco idea that we're going to have subemployment, permanently. >> the question that the fed is taking a chance. this is a different way to put it. the fed is taking a chance that 6% is where you start triggering inflation, okay? that's the real trigger here. >> on unemployment. >> they're going to go to 6.5. i think the fed is that they're not going to trigger until you get to 6%. i think that's the best i get out of this. >> i don't know if that's right. the question is do you trigger at 7%. you could trigger the real eco

>> we live in the real world -- >> what about california, illinois? skt that the exact same dynamic at walmart? you're basically taking all these taxes of people to pay old benefits? it's terrible! >> you are the last person for me to think who lives in a relatively value, relatively moral world. that's what you're talking about. >> how about i made the point. say you go over and bill gates gave you $1 billion in vaccines to every kid in theory kri. >> that's a hugish you, by the way, is that happens. >> so in your view action nating the children -- >> now you're deciding -- >> no. look at the late many retails, different parts of business. in germany, he frans the whoot guy, finished. italy is a problem. do you pay or not pay? if don't pay, nothing happens. if you do pay, nearly 10% go to jail. if you get somebody who doesn't have to pay because -- >> in the 70s, they found 400 u.s. companies were going around the world to lower -- the public said you know what, these are not companies we want to be dom sieled in our country. that's a decision, that'

german's population equal to california, texas and new york. could you say by yourselves solve it and plus -- maybe people do distrust california, new york and texas. it's time to step up, take a big pot of imf money and put it in the second loss position behind europe and say you guys create x weeks will give you y and solve this problem. >> the u.s. should give them money? the european union has enough money! >> michelle, are you happy now? is this working for you? it ain't working for me, it's not working for markets and it's not working for anybody. >> steve, 1.5% on the ten-year. we're down over -- >> i'm getting a mortgage. i love it. >> this is not the way civilized people should be living. >> you want us to go enlighten europe. who is going to enlighten us and fill our brain with ideas to go take to europe? we're emulating their path more than creating a way to prevent it. >> their problems, rick, are they're incapable of acting collectively. >> they can't act collectively. that's why this is going on forever, steve. >> by the way, nice

we've got bad news in california, morning. stockton, california, set to become the largest american city ever to declare bankruptcy. officials were unable to reach a deal to restructure debt. >> another day at european debt auctions. italy sold six-month debt at an average yield at just under 3%. it's the highest since december. let's take a quick look at futures. i think we got some green arrows across the board this morning. dow looks like it would open up about 22 points higher, nasdaq up 5 points, s&p 500 also looking green this morning. becky. >> thank you. investors obviously looking ahead to that summit of eu leaders. expectations seem to have ratcheted down over the past few days. >> gentlemen, welcome to both of you. >> hey, becky. >> roger, is this the right way to start out the conversation, looking at what's happening to europe? is that going to dictate markets for who knows how long? >> it's a tug of war between the down beat data on the u.s. economy and overhang of eurozone risk. one moment it's the eurozone prob

. >> i still think you have to pay for gas pup can go to california twice maybe. see, people can't -- you need to save the money. you got to fly commercial. that is a different level. just get a marquis jet card. >> what is the average per hour -- what do you think the average either income or net would worth is of a marquis jet cargo? >> i think you have to have $10 million of net worth and several million of w-2 money just to play in the space. >> and what number -- >> you're saying that's 1% of -- >> and what's the number on being a netjet owner? >> i would say you probably need a little more net worth than that,probably want to start at 20 or 30 to consider owning it. netjet's big opportunity is in the corporate space. if you want the balance sheets tightened up, you don't need five airplanes. you can have one or two. >> a lot of companies have g gotten rid of their planes because of the optics of it. >> the anonymity is the biggest option in the world for flying netjets. >> if you're a fractional owner, it shows up -- >> i think joe's talking about being trac

so what i wanted to do was actually break down what's gone on in each california city. there have been three cities so far that have declared bankruptcy. one i'm going to put in the very strange and tiny category that's mammoth lakes, california, for anybody who has ever gone skiing up there. >> i know it well. >> $4.3 million in municipal debt. they were unable to pay a $43 million legal judgment against a developer so that was the reason for that bankruptcy. so let's put that as a one-off. then let's go to stockton, city of 292,000 people. they do have $1 billion worth of debt outstanding. some of that, those bonds are insured, so those bonds will continue to get paid even if after the bankruptcy is said and done, bond holders don't get paid, which i'm not saying is going to happen, and then san bernardino, $220 million in debt, accused of fraudulent reporting for 16 years so that's a special situation. are cities and states still facing problems? yes. does that mean massive full scale bankruptcies? no. and i would love to point to the report that came out this week f

today authorities are assuring consumers and global importers that there's no danger from meat of the california dairy cow entering the food chain. mexico, korea, and japan say they'll all continue imports at this point but two major retailers did halt sales of the united states beef. they see no impact but as jane wells reported out last night, the damage is already done just by this report getting out. the cattle futures are down by 2.6%. a lot of this is what japan did the last time around, a major import over the u.s. beef. >> remember how scared people were? >> it took the age of 30 for this cattle, down to 20 months. the expectation is they were going to get rid of it and move it back. that's going to have an impact. >> it's really hideous. it's scary the way it happens. it's why animals don't eat other animals. >> i remember being in london when it was a real bad problem. people would not go to mcdonald's because they were that scared. >> this was a cow that was about to be taken for rendering, which means it was going to be processed for animal food, but that doesn't make people feel too

. >> investors gathering in santa clara california for intel's annual invest totoreer meeting. managing director joins us. and after years, intel getting . bullish about that or will cisco rain on the the parade? >> in-it tell has a lot of good things going on right now. fundamentally they've gone well and the stock has outperformed over the last six months. the company will be focused on all things ultra book. it's really to compete against the ipad and other mac air. and they have a lot of other between thin good things going on, but the broader market is very challenging. >> is that what we draw from cisco? can we draw any conclusions about the broader market are from john chambers being less than effusive about the future? >> the ciscos of the world are subject to a lot of competition and are price pressures from some of the chinese competitors. guys like wowway. >> and intel is a completely different animal. but number one, the demise of the pc was greatly exaggerated and i guess intel has moved along and is in other markets, as we. that's what was weird, that intel finall

if you look at warm weather climates like california, those warm climates didn't experience the same dynamics. that leads me to think there's a lot of warm temperature distortion here, whether it's jobs or claims that we saw something a little more optimistic than reality will dictate as we move through time. >> jim, why don't you weigh in on the numbers we've heard and explain where the futures have been. it was crazy to see the down draft days and now a big day yesterday. what's the trend? >> what steve and rick both pointed out, there's so many moving parts of this, this basket of numbers doesn't give us any clarity. the last employment number was disappointing. the market will look at it with a little prep dags. that being said, we were do and still are due for a corrective phase in the market. we have come far fast. for the s&p to trade down to 1,330 is reasonable. it could potentially fuel the next up leg when it start to come in. longer term i think the stock market is okay. as far as the economy goes, it remains to be seen. we're still kind of in the dark on that. >> jim, one

california, new york, delaware, nevada, have not signed on yet. banks would pay up to $25 billion in exchange about misconduct and pursuing foreclosures. >> i met somebody yesterday from vegas who said, you know, i know you guys think you're all so cute with this nevada and you take it so seriously because you think the people of nevada take it so seriously. and he said, we actually don't. he said there are people in vegas who say nevada all the ti time. >> they would say the people from vegas are the carpetbaggers of nevada. we've had people from nevada who really take issue with it on the show who called us out on it which is why we are so sensitive to it. >> i've become sensitive now as well. >> it came from people from nevada calling in. i will -- >> maybe i'm hanging with the wrong people in vegas. >> i don't doubt that. >> thank you. >>> back to the news, we have a few releases to watch today on the earnings front. we're going to get quarterly results before the bell from coca-cola. analysts are looking for a profit of 77 cents on revenue of

they don't have win thor in california. the change comes two days after governor jerry brown authorized its sale to tame skyrocketing retail gasoline prices. >> it's not helping yet. the wholesale prices have been coming down on this news, but i think yesterday the average was $4.67 a gallon still for the state of california at the pump. >> let's talk about microsoft. microsoft ceo steve ballmer has signalled a new direction. he's pointing to hardware and online services as its future, taking a page from longtime rival apple. he suggests microsoft may eventually build its new phones. >> that's a big shift. >> it's a huge shift for them to get into real hardware. they did make one of the -- i don't know if it was the surface or -- one of the prototypes for their tablet is manufactured by them. and it may be ultimately that you need to actually do the software. >> the software gets stolen by china and all these other places. they don't pay for it. so i guess you eventually want to shift to where -- >> i think that's part of i

. >> did you see catalina, california, $7 a gallon. >> a lot of hybrids there. >> yeah, that's what we want. >> i don't know what direction he is. >> if europe, it's $9 and $10. they say yeah, but it's good. i just don't think it's good to an economy. and what worries me is let's say you said every dollar in taxes goes to lowering the deficit. don't they always find a way? oh, on, we've got some other here. and then we wouldn't have on go here. >> what if they said this was going to go towards rebuilding infrastructure. >> same difference. like high speed rail between two cities in one really uses? >> no, have you looked at the last lee department of transportation bills is this very little actually goes to the -- >> do we have a highway bill passed some had. >> no, we don't. but look at the last several. there's almost no highway spending in it is the problem. >> is that because there's no funding for it? >> no, because they decide they're going to do build a museum dedicated to the pack arrested or a film about roads in alaska, they'll build a bike path, they'll build turtle tunnels.

>> california. >> california? >> yeah. this is interesting. a couple of years ago, i was coming on every show and talking to people and people weren't touching it. >> i can't tell you exact yields, but illinois is still hanging in there. they're a major issuer of debt. >> have you got a loser for us? a little coal in the stocking? >> puerto rico. >> puerto rico? >> puerto rico is just -- it's a sad situation. $67 billion in debt outstanding. their debt to gdp approaches greece-like levels. and they went so far as to bond out their debt service. issuing bonds to pay their interest and that is just a true muni bond person. that is like a knife in the heart, pain. >> don't go anywhere. stick around for the rest of the hour. thank you for being here on this holiday. >> glad to be here. >> what are you looking at? >> nothing. >> the red. >> it's like orange on camera. >> it is a little orange. >> is this a holiday? you keep saying that. >> we've been doing all sorts of holiday things. really? >> so it is the holidays? >> yes, it is. >> i've got to

. >> allow is that budget working out in california with governor moon beam? >> good morning, everybody. welcome to "squawk box" here on cnbc. we do want to talk about today's economic calendar. this afternoon the release of minutes from the last fmoc meeting. and economists are looking for the next set of clues to fed easing. dallas fed president richard fisher on "squawk box" yesterday. >> i think we ought to sit, wait, watch and in fact be looking if the economy continues to improve as to how we'll exit from the position we're currently in. not ready to tighten from my point of advocacy, but certainly not willing to support further accommodation either through greater qe or through further acceleration of operation twist. >> also the commerce tent will be releasing figures on the factory orders for the month of february at 10:00 eastern. and the nation's automakers are going to be releasing their march sales reports. edmu edmunds.com is looking for a 26% increase over february and a gain of nearly 17% from march of last year. and we have a great lineup of a

steve is joining us live from stanford university in california where this year's final presentations are taking place. thanks for joining us. >> thanks for having me. it's a great day. >> people often think that the government doesn't know how to innovate. private sector shouldn't pay attention to them. you have seen how government and private sector can work together very well. what is the single most important ingredient to making these relationships work? >> one is for each party to understand their role. the government isn't doing any innovation. what the government is doing is funding the best scientists and engineers. the national sentence federation gives out grants to the best scientists and engineers in the country. what we are doing in this program is just teaching the select few who raise their hand to volunteer how to be entrepreneurs. >> what are some of the final contestants doing in this year's group? >> it is just amazing. what we see is the best in material science and graphing and medical devices and infusion pumps. we have robots that climb walls for inspection. we

there was another piece about apple moving something to reno to from california because -- so they don't connect the dots there that, wow, money avoids -- none of that comes out of the "new york times." all they do is -- >> no, no, no. >> the whole point of the apple piece was to blame -- >> i actually thought the piece was pretty fair. but let me say one thing on the reno. >> and we know how you like fairness. >> reno, nevada issue. >> nevada. it is not nevada in any way shape or form anywhere. >> okay. in that case again, though, it's not that they're moving -- this goes back on moving people. they're not moving the people to nevada, right, they're moving like five people to nevada so they can get the better tax rate. >> but california is not a good place to do any type of business p. >> i agree. and yet automatic of the ds all last week said i have to do business in silicon valley. >> do you agree tax competition is a good thing? >> i think i do. >> tax rates are gone down over the last 30 years. >> are you following me on twitter? so you didn't see -- you know what happened to me. th

you compare that with a california at 56%. you compare that with a wf with wf, the worst -- >> what's the worst now? >> it's less than 50%. >> it's nevada. nevada. we might have that. >> nevada or nevada. >> i'm sorry. >> we go back -- >> we don't go back and forth. there's a huge. it was ended a long time ago. brian which wiilliams has done n it because we got so much flak. >> a lot of the states hit high by the housing bust still have the highest unemployment rate and as time goes on it becomes more and more clear with these big housing booms first in and first out is not happening. they tend to be first in and last out. it's a lasting legacy about what's happening with the u.s. broadly. this isn't a case where you're california, you have a housing bust, no, they tend to be out and stay out and these problems become structural. >> how come there's such a higher percentage of people who work in the dakotas? >> there's jobs. it's energy. that sector is doing so well and there are so many people who go to those states and work.

john fortt was there and joins us now from california with a lot more. >> i would say it is bright and early. he had a very interesting talk last night, went almost two hours. first taking questions from walt and swisher and then from the audience. he tackled a number of topics including labor in china and overtime rules. >> last month we were at 95% compliance. we are measuring working hours for 700,000 people. i don't know anybody else doing this. and we're reporting it. so you can go on our website and see. >> he said he wants there to be an apple product from the future built in the u.s. let me give you a few other highlights. he all but admitted the failure of the ping social network. he hinted at a warming relationship with facebook mentioning he just talked to cheryl sanburg and said apple doesn't need to own a number of things. said of siri there is more it can do. he talked about mna, too. >> i'm not looking at a big one right now. we are not looking at a big one right now. but i wouldn't rule it out. and so for us we have historically not bought a company for revenues trade.

. >> california judge has now december m dismissed a suit aimed at the former lead singer of the village people by exercising his right to reclaim ownership of ymca. carl and melissa join us. >> are you going to do the -- >> sure, yeah, of course. who can't? we're actually going to talk about -- >> are you focusing on the travolta case or something? >> ravolta, i think, is the headline. >> pulp friction. >> it's going to be a rock'm sock'm session here. spain back to an october 2003 low. and german yields, again, close to a record low. >> yes, in the markets yesterday, i know you noticed this. we had that turn around at the end of the day. that's largely baize what was going on in the european banks. it's pretty much the same story. we're seeing tremendous pressure or morgan stanley as well as the rest of the banks as we are awaiting to take action on about a hundred banks around the world. >> also jive software is on the show which we thought would have come in handy on that flight in airpla airplane, right? >> exactly. that was a classic, carl. see. right, andrew? >> a cloud play, also

and i don't have to wait 17 extra hours to get it in california. >> very democratic. of course not everyone is so thrilled with the apple release. at 6:20, we will talk to one company that sells accessories to apple products. it says it is being hurt by the new iphone. and if you haven't heard that, wait until you hear about some of the issues with the maps. big story on the "wall street journal" today. also on squawk this morning, a rare interview with ray dalio. andrew caught up with him in new york. we will bring you parts of that conversation in just a moment. and speaking of the fed and the economy, we have two of the most quoted voices on the topics with us onset this morning. pimco ceo mohamed el-erian and stanford professor john taylor. so a pakd lied line up. but first back over to joe for the today's top headlines. >> i was standing over there to pretends i'm -- you know what i think happened, i think he got the iphone 5 and is using their map. >> i think so. there was a tweet that was very funny this morning. they said all of you people waiting for your new

within the last three weeks, three cities in california have gone bankrupt. bad news flows downhill. the typical state relies upon the federal government for about 40% of its revenues. government is going to spend less over time and tax more. the ratio is going to be more spending reduction than revenues. states need to get their act together, reform their pension programs, deal with their huge unfunded retiree health obligations and they need to do it soon because time is working against them. >> when do you -- what will it take for you to say, i'm out of here? will you get frustrated because nothing good ever happens? >> i'm going to devote my energies for probably another year to this on a full-time basis and then i'm going to go something else. >> what's the something else? >> i don't know yet. i haven't decided. >> you think we'll make any progress in the next year? >> i believe it is critically important that we have some grand bargain in 2013. i think it can happen. >> that means 50/50? >> better than 50/50 if two

then add 13.8 in california. and you're a small business, running as an "s" corporation, should you really pay higher than 50% of income into government? that's before any sales tax. that's before paying the cable tax to watch this show. that's before paying the water tax when you take a shower. think about that. and people want to just give more? and hope spending cuts will come at some later today? >> congressman, we hear you. we appreciate it. and thanks for appearing this morning. >> thanks for having mean >> okay. >> when we come back, the headline number on friday's jobs report shows better than expected payroll gains. but there were sceigns of weakns in the participation rate and downward provisions to earlier reports. steve liesman joins us next with more on how economists are reacting to those numbers. >>> tomorrow, "squawk box" is kicking off a special day of fiscal cliff coverage. rise above: mission critical. becky quick and jim cramer, live in washington. 33 special guests, grover norquist, congressm

buys california debt or something like that. we do not do this thing. >> is that because they are picking winners and losers? >> they are absolutely helping particular sectors and particular regions of europe and you might say that's because of the nature of the crisis. i would not go in that direction. if you want to do quantitative easing in europe and maybe it's warranted, they are in recession, if you want to do it, you should buy debt across the board, gdp weighted and you should say that i'm doing this because it's going to help the european economy, not because i'm going to help one sector or another sector. this business of helping just a particular group or a particular region, you know, what are you going to do then when other regions are in trouble and when there's other problems? it politicizes the monetary process. i'm concerned about that for the future central banking globally. >> should they use what's left of their positive 75 basis points? >> it sounds to me like they will make a move in that direction, i think

. >> we're going to go to california. you're going to stay here and man the ship. we're going to go out there. >> you're going to eat and then come back and it starts up again? >> i'm going to stay relatively -- i have a little -- i'm allowed to put skim in my coffee but then when i come back i'm going to do it. we're going to california, as you know, out to pebble and we're going to do the show from out there. >> that's coming up in about a week. >> you know who is coming on? >> i heard. >> the cinderella story. he's the defending champion of the pro-am. won last year. >> i decided that's probably why he committed so early. he doesn't want to change anythi anything. he won the tournament. i think he had fun, too. i have to do the exact same thing. >> maybe. maybe. >> i would. i'd be so superstitious. >> i'd be surprised if he didn't have d.a. points again and he won the tournament, too. >>> in other golf and dieting news this morning, nobody is laughing. in global headlines this morning iran's oil minister saying that the kcountry ready to halt some oil exports so

i went boston, new york, all over california and that added some belief that the u.s. is on the mend. and yet the markets are obviously now very worried about the interconnectivity of bank lending because of the unfortunate recent episode with jpmorgan and this mess in europe. >> there is. i see a lot of people that say let greece go. but now it almost looks like both the left and the right in greece and most of the eu from germany on down, they really want to try and make this marriage -- well, it's like 19, it's more like a commune, they want to make this work. they really all seem to think it's really important when the prospect of a disorderly exit really came to the fore about two weeks ago. i think that really scared people. >> well, my interpretation of it over the weekend and this morning is that the fed have been trying to make sure the greek people realize what they're voting for. and by hyping and heightening the focus, the decision on june the 17th is effectively a choice -- do you want to get our support or not? whereas i think the first, you know, looking

. >>> california amusement park knott's berry farm, 20 riders on the wind seeker were stranded 300 feet in the hour for four hours after the ride stalls. >> like my nightmare. >> every time i get on the rides you think what is the worst? the ride will be closed while park officials investigate the accident but four hours sitting 300 feet in the air. >> that's a nightmare for me as are ski lifts. i'm always scared they're going to stop and i'm going to be stuck up there. >> i don't know. no, no, no, no. no, no. no. i have seen people getting unloaded from -- i would have to stay. >> what about the top of the kingdaka. >> they come down, you know, totally red and -- no. you know what? pass the i'm passed the thrills. somebody has to go with your kid. >> you can't let them go by themselves. >>> when we come back, whether the markets are in for a wheeled ride and he is in charge of startup investing for google ventures, william maris talks about venture capital and today's hot tech startups. "squawk" will be right back. >>> tomorrow a rare interview with ray dalio. >> were you surprised las

if you hadn't done obama care, if you don't -- >> if you don't have models and do empair california work. so what do you do? er. >> owe. >> nobody knows what the root model is. we have a model we have confidence in. >> i got john taylor's model, who's right? >> we think we're right. don't tell me you what happens without taking account what would have happened without the policy. nonsense. impossible. >> larry, have i huge respect for you about what you're saying makes absolutely no sense. mark your models to market in light of what the economy has done over the four and a half years, past four and a half years, the traction from monetary policy has been the major disappointment of this so-called post-crisis recovery. so it's time to take a really hard look at models that are based on the assumption, and i say this is an assumption. there's no science to what you're saying, larry. >> course there is. there's art and there's sign. >> what s your -- you have zero sides. you're flying blind. >> i'm looking at what's going on, larry. >> no, that's just terrible! >> it's terrible to look at w

california time. >> i wish he would guest host for two hours, if he would guest host for two hours. >> get that going? >> it's early and he's defending this year. he won last year. >> if if he's going to play that day -- >> i have to play that day, too, and i'm not defending. what do pictures and coffee have in common? two household names in that space hit hard in afternoon hours trading last night. details next. up first, though, attention new york city. mayor michael bloomberg must close. what a concept. maybe we could do that on a federal level. he must close a $2 billion gap. a spokesman says it will be done without new taxes. now as we head to break check out the global market headline. >>> welcome back to "squawk box." u.s. equity futures at this hour on ground hog day the dow would open 0 up a little lower off about ten points. the s&p and the nasdaq off or rather up about two and a half points. watch shares of green mountain could ha coffee roasters today. the company's first quarter earnings surging as sales of k-cup portion packs more than doubled. shares jumping in after ho

what you have heard from being there in california? >> well, i really don't know what went into the price negotiation, but you know generally when the underwriter is negotiating a price with the issuer, the underwriter has all the leverage. the company can't go out and get another underwriter or check comparable prices. by the same token, facebook was such an unusual and, you know, attractive deal for an underwriter that they probably bent over backwards to try and accommodate what the management thought it was worth. >> they took 1% fees versus the normal fees they'd get paid for these things. it makes you think the underwriters did not have a whole lot of control. >> it's a competitive world. the underwriter fees have been coming down because electronic communication and electronic distribution is so much chipper than the way it used to be. >> i know you think the duck auction model is really the way to go. have you heard more people say they'd be interested in following something like that since they've seen what happened with faceb

blue harbour manages over $200 million for the california teacher's state retirement system, he's an old partner of henry kravis and used to work at general atlantic as well. we had mr. ackman on before, he takes a different approach to activism. what are you doing? >> i think it's important to tease out the difference between active ownership which is what we do and activist investing. it's a little confusing. in the corporate world activism is different, it's aggressive, from our business. i've never done a proxy contest or sued a company. we're backing companies where there's scope to unlock value and identified companies to do so. >> if a company doesn't want to talk to you, you leave them alone. >> it's more about the quality of the conversation, if we are engaging with a company and they seem to be closed minded and not open to new ideas we would invest. if on the other hand they're interested in probing ideas and looking to are ways to win this could be a good opportunity. >> let's talk about pension funds. in this qe3 world where you can't make a buck with owning treasuries,

still scattered snow showers in parts of the -- let's see, parts of the mountains in california. not only portions of the san gabrielle mountains, but also the mountains in sierra, nevada. it's going to cause some backups in places. san diego, you might have a few delays there. in vegas, miami and new york, minor to no delays whatsoever. that's the good news. very quickly, let's talk about the east coast. so far, so good. scattered showers on parts of the coast, but new york city expecting a high of 45 today. mostly sunny in the ohio valley, into parts of the northeast. still scattered showers in parts of south florida getting very close to the record, the yearly record of rainfall in miami. as we wrap it up, from fargo and on the other side of the river, expect snow showers. still balmy, beautiful showers in dallas. mostly sunny and 65. back to you. >> reynolds, thanks so much. thanks for flag along. >> you bet, guys. >>> americans want action when it comes to the fiscal cliff. john, you'll give us some of the highlights, but with what we've told them about what will happen if w

you're in california. is there any businesses left at all in that state? >> there are quite a few. go to silicon valley, los angeles, san francisco. this is still the engine of innovation for the u.s. economy. >> they're making it tough on you. >> we could be doing better, that's true. >> so neel, when you say that this does lift some immediate uncertainty but you're not sure what it means beyond that, what do you think the market does between now and the end of the year, let's say? maybe not this week but between now and the end of the year under a reelected president obama or under a newly elected mitt romney? >> well, i think under reelected president obama, i would expect to see volatility increase especially as it relates around the fiscal cliff. we need to see them come together, divided government needs to work together. they have not worked together very well over the past couple years so the markets will take a wait and see approach and there's a good chance there will be fighting and brinkmanship until the last second for the fiscal cliff. republican sweep it's more likel

it's financing -- >> you want every state to be california? >> it's financing the subway that helps a lot of people get to work and not all of them rich people. >> thank you for being here. >> it's part of an important thing in america where we do not bail out our cities and states, and by keeping those rates low is the best way. >> coming up, ecb president draghi's news conference at 8:30 a.m. about the sovereign buying program and early read on jobs at 8:15 a.m. eastern, get the adp private payroll numbers. bob... oh, hey alex. just picking up some, brochures, posters copies of my acceptance speech. great! it's always good to have a backup plan, in case i get hit by a meteor. wow, your hair looks great. didn't realize they did photoshop here. hey, good call on those mugs. can't let 'em see what you're drinking. you know, i'm glad we're both running a nice, clean race. no need to get nasty. here's your "honk if you had an affair with taylor" yard sign. looks good. [ male announcer ] fedex office. now save 50% on banners. >>> coming up an upda

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. >> he's joining us very early this morning from the company's hometown of san francisco, california. david, thank you for joining us. i want to talk about the earnings in just a little bit, but first a lot of people look at this, you've been growing so quickly, why are you starting to tap the brakes a bit in terms of taking delivery of aircraft as well as expand manage to new markets? >> i think a couple of things here. first of all, we felt the need to get to critical mass which we believe we've done. we have 50 aircraft now. and so we feel comfortable slowing down the growth. but i would say the key thing we've seen in the two years since we in addition will made the order is the increase in fuel prices and basically what is a slowly growing economy. and when you do the math, it doesn't make sense to go in and continue the rapid expansion. >> part of this tapping the brakes, if you will, is slowing down the rate and pace of taking new aircraft from airbus. some people say wait a second, those will be more fuel efficient, why wouldn't you want those sooner rather than later because

. >> for the folks in california, like the google guys -- >> what's the headline, the lead from the thing? >> the lead? let me think about it. >> when we come back, we'll be speaking with former treasury secretary larry summers. stick around. tdd#: 1-800-345-2550 and the streetsmart edge trading platform from charles schwab... tdd#: 1-800-345-2550 gives me tools that help me find opportunities more easily. tdd#: 1-800-345-2550 i can even access it from the cloud and trade on any computer. tdd#: 1-800-345-2550 and with schwab mobile, tdd#: 1-800-345-2550 i can focus on trading anyplace, anytime... tdd#: 1-800-345-2550 until i choose to focus on something else. tdd#: 1-800-345-2550 trade at charles schwab for $8.95 a trade. tdd#: 1-800-345-2550 open an account and trade up to tdd#: 1-800-345-2550 6 months commission-free online equity trading tdd#: 1-800-345-2550 with a $50,000 deposit. tdd#: 1-800-345-2550 call 1-800-836-8799. bp has paid overthe people of bp twenty-threeitment to the gulf. billion dollars to help those affected and to cover cleanup costs. today, the beaches and gulf are o

they might have brought california back to reality but it's still out there someplace. >> texas instruments downgraded to neutral from positive at susquehanna research, citigroup downgraded to neutral from buy, interactive corp. upgraded to buy from hold and allstart downgraded to market perform from outperform, target cap remains $40 a share. >>> coming up at the top of the hour we'll kick off the fourth quarter with jeremy siegel and tell you where you should be putting your money to work and one of the fed's proponents of quantitative easing, charles evans joins us, and some of the other prospects for our economy. "squawk" is back right after this. if we want to improve our schools... ...what should we invest in? maybe new buildings? what about updated equipment? they can help, but recent research shows... ...nothing transforms schools like investing in advanced teacher education. let's build a strong foundation. let's invest in our teachers so they can inspire our students. let's solve this. we were just driving along, comin' back from the lake, and all of a sudden, ka-plam. it blindsid

potentially absorb, but supplies are tight with the explosion in venezuela last week, the refinery fire in california as well. there's not a lot of room for error, so the hope is that this comes and goes quickly. guys? >> all right, scott cohn, thank you. you'll be reporting down there all day and we'll see what happens, 400 miles wide. see you later, scott. >>> the markets as you know they have had a nice run lately. will the rally continue? patrick wolff started grandmaster capital back in 2011, packed by peter thiel, the fund is up 18% year-to-date, and sir, thank you for joining us today. >> thanks for having me. >> we know peter thiel gave you seed money. you're the only hedge fund he's ever seeded. how did you run into him? >> i met peter actually almost a dozen years ago when we were both working in silicon valley. unfortunately i was not working at paypal so the dot-comi was working at didn't have the same happy ending. we became friends, go the to know each other and in 2005 came out to join clarion and worked with him there for five and a half years. >> you have a long short strategy for th